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$516.0 million in combined revenues for the year ended December 31, 2011. The remaining increase in revenues was due to
increased volume from production efficiencies at our other ethanol plants and increases in ethanol and distillers grains prices.
Cost of goods sold in the ethanol production segment increased $1.0 billion for the year ended December 31, 2011
compared to the same period in 2010. The increase was due primarily to the consumption of 61.1 million additional bushels
of corn and a 56.9% increase in the average cost per bushel during 2011 compared to 2010. The volume increase was due to a
full year of production at our Lakota and Riga plants and three quarters of production at our newly-acquired Otter Tail plant.
Gross profit and operating income for the ethanol production segment decreased by $18.1 million and $20.2 million,
respectively, for the year ended December 31, 2011 compared to 2010 primarily due to a greater increase in the average cost
per bushel of corn than the average price per gallon of ethanol, which increased by 43.1%. In addition, depreciation and
amortization expense for the ethanol production segment increased to $43.2 million during 2011 compared to $32.6 million
in 2010 due to the acquisitions of the plants noted above in the fourth quarter of 2010 and first quarter of 2011.
Corn Oil Production Segment
We initiated corn oil production in the fourth quarter of 2010 with the acquisition of our Lakota and Riga ethanol plants
and installation and deployment of corn oil extraction technology at our Obion and Ord ethanol plants. In 2011, we deployed
corn oil extraction technology at our other ethanol plants. We currently have the capacity to produce approximately 130.0
million pounds of corn oil annually. During the year ended December 31, 2011, we sold 96.3 million pounds of corn oil
compared to 5.0 million pounds in 2010.
Agribusiness Segment
The table below presents key operating data within our agribusiness segment for the periods indicated:
Grain sold
69,336
56,215
(thousands of bushels)
Fertilizer sold
64,749
60,653
(tons)
Year EndedDecember 31,
2011
2010
Our agribusiness segment had an increase of $183.4 million in revenues, an increase of $9.6 million in gross profit, and
an increase in operating income of $6.1 million for the year ended December 31, 2011 compared to 2010. Revenue, gross
profit and operating income increased primarily due to an increase in fertilizer volumes from our agribusiness operations in
Iowa, the sale of an additional 12.4 million bushels of grain from our western Tennessee agribusiness operations acquired in
April 2010 and increases in average grain prices. The Tennessee agribusiness operations contributed $289.0 million in
revenue in 2011 compared with $141.6 million in 2010. The agribusiness segment’s quarterly performance fluctuates on a
seasonal basis with generally stronger results expected in the second and fourth quarters each year.
Marketing and Distribution Segment
Marketing and distribution revenues increased $1.2 billion for the year ended December 31, 2011 compared to the same
period in 2010. The increase in revenues was primarily due to an increase in ethanol revenues of $1.1 billion and an increase
in distillers grains revenues of $124.0 million. The remainder of the increase in revenue is attributable to sales of corn oil,
which we began producing in October 2010. During 2011, we sold 96.3 million pounds of corn oil. We sold 1,064 million
gallons of ethanol within the marketing and distribution segment during 2011 compared to 917 million gallons sold during
the same period in 2010 and experienced an increase in revenue per gallon of ethanol sold due to higher prices. The increase
in ethanol volumes is due to the expanded production of our own plants as a result of efficiency improvements and additional
capacity from recently acquired operations. Marketing and distribution volumes from third-party ethanol producers decreased
when comparing the year ended December 31, 2011 to the same period in 2010 due to the termination of a third-party
marketing contract with expected production of 110 mmgy in May 2011.
Gross profit for the marketing and distribution segment increased $1.9 million and operating income decreased by $0.2
million for the year ended December 31, 2011 compared to 2010. The increase in gross profit was due primarily to increased
ethanol and distillers grains volumes sold. Operating income was affected by an increase in selling, general and